News & Commentary:

Articles/Commentary

The fight for ‘China’s sorrow’
Lucy Hornby (FT) Sep 1, 2014
As the economy booms, the burden on the Yellow River has increased and the challenge for Beijing is to prevent the sixth-longest river running dry.

Financial reforms will not help crises
John Plender (FT) Sep 1, 2014
Unlike a bailout, bailing in creditors will inflict losses on other systemically important financial institutions.

India’s economic confidence returns
James Crabtree (FT) Sep 1, 2014
The idea that India could expand more rapidly than China no longer seems absurd, but the country’s recovery remains both gradual and fragile.

The Human Toll of Offshoring
Joe Nocera (NYT) Sep 1, 2014
What should we be doing to make globalization work for us instead of against us?

The World's Youngest Failed State
Madhu Narasimhan (FA) Sep 1, 2014
In the 12 years since gaining independence, East Timor has struggled in almost every facet of economic and political management. As its neighboring economies boom, it is quietly on the path to becoming a failed state. And it is quickly running out of time to change course.

Africa's City on a Hill
Seth Kaplan (FA) Sep 1, 2014
Lessons from Lagos.

Can't Buy Me Love
John Osburg (FA) Sep 1, 2014
China's new rich and its crisis of values.

Banker to the Poor
Jim Yong Kim (FA) Sep 1, 2014
The World Bank's president talks to Foreign Affairs about fighting inequality, his reform program, and who should succeed him.

Spain's 50-Year Bond Opportunism
Mark Gilbert (Bloomberg View) Sep 1, 2014
Spain can borrow money for half a century at just 4%; where on earth is its motivation for economic reform expected to come from?

Down with Dengism
Minxin Pei (Project Syndicate) Sep 1, 2014
China has held a series of high-profile ceremonies honoring the 110th anniversary of former leader Deng Xiaoping’s birth. But, though Deng deserves appreciation for having brought China back from the abyss of Maoism, his authoritarian development model is impeding China’s prospects.

Democracy in the Twenty-First Century
Joseph E. Stiglitz (Project Syndicate) Sep 1, 2014
The economist Thomas Piketty’s forecast of still higher levels of inequality does not reflect the inexorable laws of economics. Indeed, the main question today is not really about capital in the twenty-first century; it is about democracy in the twenty-first century.

Christian Daude & Eduardo Levy Yeyati (VoxEU) Sep 1, 2014
Central banks’ exchange rate interventions are typically attributed to precautionary, prudential, or mercantilist motives. This column documents the prevalence of an alternative motive – that of stabilising the exchange rate – in emerging markets, where, despite heavy intervention, the Global Crisis saw important deviations of the real exchange rate from its equilibrium value. Exchange rate intervention is shown to be effective, but more so at containing appreciations than depreciations.

Has Draghi Really Saved the Euro?
Desmond Lachman (TIE) Sep 1, 2014
The currency rests on two questionable premises.

The Great Bubble Debate
Bernard Connolly (TIE) Sep 1, 2014
Can both sides be right?

Yellen vs. the BIS: Whose Thesis Makes Better Sense?
Various (TIE) Sep 1, 2014
The economic policy world is in stark intellectual disagreement.

Eurozone: Draghi’s new deal
Claire Jones (FT) Sep 2, 2014
The ECB president’s call for a fiscal and monetary compact between it and the currency bloc members is seen as vital by some observers but a ploy by others.

Predators eye opportunities to swoop in Asia
Henny Sender (FT) Sep 2, 2014
Investors are gearing up for what many expect to be more widespread openings across Asia as both the level and the cost of debt rises.

Holdouts give vultures a bad name
Martin Wolf (FT) Sep 2, 2014
Argentina’s creditors should make every effort to protect themselves from the vagaries of American judges.

Instinct and analysis inform wise choices
John Kay (FT) Sep 2, 2014
We have an army of transport modellers, environmental experts and risk managers turning evidence-based policy into policy-based evidence.

QE would end EU financial fragmentation
Gene Frieda (FT) Sep 2, 2014
For large swaths of the eurozone real interest rates remain inappropriately high given low levels of inflation, despite yields being at all-time lows.

The Climate Change Agenda Needs to Adapt to Reality
Edward P. Lazear (WSJ) Sep 2, 2014
Limiting carbon emissions won't work. Better to begin adjusting to a warmer world.

China's Runaway Steel Industry
Adam Minter (Bloomberg View) Sep 2, 2014
Despite orders from Beijing, China's steel industry continues to expand at a dizzying and unprofitable pace. Can anything slow it down?

Why This Market Rally Is So Unloved
Mohamed A. El-Erian (Bloomberg View) Sep 2, 2014
Readers' comments suggest investors don't trust the rally but won't fight central banks.

Educating Everyone
Gordon Brown (Project Syndicate) Sep 2, 2014
The odds are weighed heavily against achieving the target set by the Millennium Development Goals of ensuring by December 2015 that every school-age child is actually in school. With children in Gaza, Syria, Iraq, and Nigeria in the firing line in recent months, the scale of the challenge could not be more apparent.

Teaching Economic Dynamism
Edmund S. Phelps (Project Syndicate) Sep 2, 2014
Business leaders often argue that the widening education gap – the disparity between what young people learn and the skills that the job market demands – is a leading contributor to high unemployment and slow growth in many countries. But the two main arguments underpinning that claim are weak, at best.

The Exaggerated Death of Inflation
Kenneth Rogoff (Project Syndicate) Sep 2, 2014
Modern central banking has worked wonders to bring down inflation. Ultimately, however, a central bank’s anti-inflation policies can work only within the context of a macroeconomic and political framework that is consistent with price stability.

Let There Be Light
Todd Moss and Benjamin Leo (FA) Sep 2, 2014
Washington's ambitious plan to help Africa generate electricity.

Prospects for Asia and the Global Economy
Reuven Glick and Mark M. Spiegel (FRBSF Economic Letter) Sep 2, 2014
The challenges faced by policymakers in advanced and emerging economies as they continue to recover from the recent global financial crisis.

The impact of capital requirements on bank lending
Jonathan Bridges, David Gregory, Mette Nielsen, Silvia Pezzini, Amar Radia and Marco Spaltro (VoxEU) Sep 2, 2014
Since the Global Crisis, support has grown for the use of time-varying capital requirements as a macroprudential policy tool. This column examines the effect of bank-specific, time-varying capital requirements in the UK between 1990 and 2011. In response to increased capital requirements, banks gradually increase their capital ratios to restore their original buffers above the regulatory minimum, reducing lending temporarily as they do so. The largest effects are on commercial real estate lending, followed by lending to other corporates and then secured lending to households.

China tightens its grip on Hong Kong
David Pilling (FT) Sep 3, 2014
Power resides with Beijing and the presence of Li, Beijing’s emissary, has relegated Hong Kong’s own officials to irrelevance.

Quantitative easing is the wrong route
Michael Heise (FT) Sep 3, 2014
Over-indebted households and companies in the eurozone are unlikely to pile up more debt. This makes monetary policy ineffective.

The World’s Polio Problem
Globalist Sep 3, 2014
Polio is still a big problem for poor, war-torn countries.

Why Trade Matters in Four Maps
Fred Dews (Brookings) Sep 3, 2014
How the U.S. can overcome challenges in current trade negotiations.

Mario Draghi's Stimulus Dilemma
Mohamed A. El-Erian (Bloomberg View) Sep 3, 2014
Thanks to the inaction of European governments, the ECB probably won't be able to launch a full-scale stimulus program this week.

Is Abenomics Working?
Koichi Hamada (Project Syndicate) Sep 3, 2014
Preliminary GDP data show a 6.8% contraction year-on-year in the second quarter of this year – the largest since the 2011 earthquake and tsunami that devastated the country. It is time for Japan's leaders to shift their focus toward a new growth strategy, centered on labor-market reform, deregulation, and corporate-tax changes.

Should Scotland Leave the Pound Zone?
Harold James (Project Syndicate) Sep 3, 2014
Advocates of independence for Scotland have long insisted that they are motivated by the distinctiveness of Scottish identity. But, as Scots prepare to vote in this month's referendum on whether to remain in the UK, the more immediate issue is money.

The political economy of regional policy and industrial location
Magnus Wiberg (VoxEU) Sep 3, 2014
Regional policy is a primary expenditure item for many countries. A substantial share of the regional policy budget is allocated to firms in poor regions. This column argues that electoral concerns and rent-seeking behaviour bias regional policy in favour of smaller regions. However, this bias lowers total welfare.

A world retreating from globalisation
Philip Stephens (FT) Sep 4, 2014
The architect of the present era of globalisation is no longer willing to be its guarantor as it no longer serves the national interests.

The price of keeping the pound for Scots
Martin Wolf (FT) Sep 4, 2014
Scotland, but not the UK, would have an incentive to profligacy, and one-sided risk demands one-sided control.

An unequal world is an economic threat
Gillian Tett (FT) Sep 4, 2014
Since the global economic crisis of 2008, western growth rates have been disappointing: economists fear ‘secular stagnation’

Draghi brings out ABS rocket boosters
Ralph Atkins (FT) Sep 4, 2014
ABS programme will take central bank significantly closer to providing credit direct to the real economy, relieving burden on weakened banks.

Africa Beyond Ebola
Ana Palacio (Project Syndicate) Sep 4, 2014
Among this summer’s grave global worries, the spread of the Ebola virus has monopolized the discussion of Sub-Saharan Africa and reinvigorated hoary notions of disorder and despair – at a time when a new image of a dynamic Africa was emerging. In fact, there is still strong reason for optimism about the region’s prospects.

The BIS Bashers
Mojmír Hampl (Project Syndicate) Sep 4, 2014
The Bank for International Settlements exists not just to represent central banks, but also to offer ideas and intellectual feedback. Unfortunately, too many central bankers are seeking to marginalize the BIS in debates over "unconventional" monetary policy.

Africa’s Hidden Hunger
Ramadhani Abdallah Noor (Project Syndicate) Sep 4, 2014
Just over 20 years ago, South African photographer Kevin Carter shocked the world with a controversial photograph of a famished young Sudanese child being watched by a vulture during a famine. Two decades later, the conditions that the photograph depicts remain essentially the same.

What The Economist could have read before suggesting that U.S. slavery wasn’t all bad
Chris Blattman (WP) Sep 5, 2014
On Friday, The Economist retracted a book review that went soft on slavery. But the review of Edward Baptist’s book, “The Half Has Never Been Told” wasn’t just racially insensitive, it was soft on evidence, too.

The ECB Throws down the Gauntlet
Jacob Funk Kirkegaard (PIIE) Sep 5, 2014
The European Central Bank (ECB) surprised financial markets on September 4 by announcing an interest rate cut of 10 basis points, a new program to purchase asset-backed securities (ABS) in the nonfinancial sector, and another round of purchases of covered bank bonds.

Should Venezuela Default?
Ricardo Hausmann and Miguel Angel Santos (Project Syndicate) Sep 5, 2014
The fact that President Nicolás Maduro's administration has chosen to default on 30 million Venezuelans, rather than on Wall Street, is not a sign of its moral rectitude. It is a signal of its moral bankruptcy.

Were we happier in the stone age?
Yuval Noah Harari (Guardian) Sep 5, 2014
Does modern life make us happy? We have gained much but we have lost a great deal too. Are humans better suited to a hunter-gatherer lifestyle?

There's poverty in the UK, but we are better off calling it inequality
John Lanchester (Guardian) Sep 5, 2014
If you think the world is too divided into those who have the cream and those who don't, you ain't seen nothing yet.

Increasing government popularity predicts emerging-market financial crises
Christoph Trebesch, Helios Herrera and Guillermo L. Ordoñez (VoxEU) Sep 6, 2014
Financial crises are often credit booms gone bust. This column argues that ‘political booms’, defined as an increase in government popularity, are also a good predictor of financial crises. The phenomenon of ‘political booms gone bust’ is, however, only observable in emerging markets. In these countries, politicians have more to gain from riding the popularity benefits of unsustainable booms.

Trade liberalisation, quality upgrading, and export prices
Haichao Fan, Yao Amber Li and Stephen Yeaple (VoxEU) Sep 6, 2014
Trade liberalisation has transformed the economies of many developing countries. This column presents evidence from China’s accession to the WTO. The authors find that high tariffs on imported inputs prevented Chinese firms from producing high-quality goods. When these tariffs were reduced, firms upgraded the quality of their products, entering more competitive foreign markets.

Allegations of dirty tricks blur picture
Demetri Sevastopulo (FT) Sep 7, 2014
Critics say China is dismantling the ‘one country, two systems’ model, aided by a business community that worries about losing contracts.

What Draghi must do next to fix Europe
Wolfgang Munchau (FT) Sep 7, 2014
Eurozone policy makers and their economic advisers are structuralists by inclination. The monetarists are mostly gone, even in Germany.

Reform is the answer to secular stagnation
Lawrence Summers (FT) Sep 7, 2014
There may now be supply-side barriers that hold the economy back before constraints on demand start to bind.

Sanctions oil Russia-China relations
Guy Chazan (FT) Sep 7, 2014
As restrictions on access to western funds start to bite Moscow is building ties with the neighbour it was at war with 45 years ago.

China’s Education Gap
Helen Gao (NYT) Sep 7, 2014
The school system serves to reinforce entrenched social exclusion.

Scots, What the Heck?
Paul Krugman (NYT) Sep 7, 2014
The very bad economics of independence.

The Fed Is Looking Like a Sovereign Wealth Fund
David Malpass (WSJ) Sep 7, 2014
Instead of tackling a complex new investment mission, the Fed should establish a clear portfolio wind-down process.

A ‘sovereign subsidy’ – zero risk weights and sovereign risk spillovers
Josef Korte and Sascha Steffen (VoxEU) Sep 7, 2014
European banking regulation assigns a risk weight of zero to sovereign debt issued by EU member countries, making it an attractive investment for European banks. This column defines a ‘sovereign subsidy’ as a new measure quantifying to what extent banks are undercapitalised due to the zero risk weights. Using recent sovereign debt exposure data, the authors describe the build-up of this subsidy for both domestic and cross-country exposures.

Australia: Culture clash
Jamie Smyth (FT) Sep 8, 2014
The economy is facing its biggest challenge in a generation and yet the government seems preoccupied with policies that have led some to claim it is waging an ideological war.

Why investors ignore war and terror
Gideon Rachman (FT) Sep 8, 2014
Global political change has done more to create investment opportunities than to destroy them while it is economics that shifts sentiment.

Default call highlights Venezuelan weakness
Paul Rathbone (FT) Sep 8, 2014
Harvard economist suggests Caracas default on its foreign bonds to share its financial burdens with its creditors, rather than its citizens alone.

Question hangs over Draghi’s latest salvo
Patrick Jenkins (FT) Sep 8, 2014
There is good reason to be sceptical. The new measures are indirect and there is no guarantee that freed-up lending capacity will be channelled into SMEs.

Salmond’s threat on the pound and debt
James Mackintosh (FT) Sep 8, 2014
There will almost certainly be no actual debt repudiation despite threat by Scotland’s first minister. Scotland will not take on debt and then refuse to pay.

Post-QE wave to break over fund managers
Mohamed El-Erian (FT) Sep 8, 2014
Central banks helped the industry avoid disaster and rebuild profits, but managers will need to deal with the side effects of unconventional policy.

Facing Reality in the Eurozone
Adair Turner (Project Syndicate) Sep 8, 2014
The implications of ECB President Mario Draghi’s comments at the annual Jackson Hole gathering of central bankers contained a more startling implication than many initially recognized. Escaping from recession and avoiding a eurozone breakup will require ECB-financed fiscal stimulus.

Africa’s Education Imperative
Viswanathan Shankar (Project Syndicate) Sep 8, 2014
In Africa, large-scale investment in education has enabled significant gains in literacy, school attendance, and university enrollment in recent years. But the continent still has a long way to go.

Scotland's Exit: An Earthquake for Britain
Denis MacShane (Globalist) Sep 8, 2014
London has already lost in the fight for Scottish independence.

The Federal Reserve in the run-up to the Global Crisis
Stephen Golub, Ayse Kaya and Michael Reay (VoxEU) Sep 8, 2014
Since the Global Crisis, critics have questioned why regulatory agencies failed to prevent it. This column argues that the US Federal Reserve was aware of potential problems brewing in the financial system, but was largely unconcerned by them. Both Greenspan and Bernanke subscribed to the view that identifying bubbles is very difficult, pre-emptive bursting may be harmful, and that central banks could limit the damage ex post. The scripted nature of FOMC meetings, the focus on the Greenbook, and a ‘silo’ mentality reduced the impact of dissenting views.

Income-induced expenditure switching: Evidence from Latvia
Rudolfs Bems and Julian di Giovanni (VoxEU) Sep 8, 2014
Unconventional policy responses to the 2008-09 Crisis in Latvia and its subsequent recovery caught many economists by surprise. This column uses evidence from detailed product-level data to argue that income-induced expenditure switching from expensive imported to cheap domestic goods was an important contributor to the external adjustment. The conventional relative price channel played a small role.

Modi Misses the Mark
Derek Scissors (FA) Sep 8, 2014
India's new government lacks economic vision.

Europe has to do whatever it takes
Martin Wolf (FT) Sep 9, 2014
The new European Commission needs to take a stand for common sense and growth, instead of insisting on misery yet again.

Dilemma of defining banking risk appetite
Howard Davies (FT) Sep 9, 2014
Reaching an understanding that allows banks to take measured risks without fear of later challenge remains difficult.

Rural Capitals, Big-Time Problems
Filipe R. Campante (NYT) Sep 9, 2014
Moving a government to an isolated spot, as Argentina may do, can mean more corruption.

The Federal Reserve's Too Cozy Relations With Banks
Stephen Haber and Ross Levine (WSJ) Sep 9, 2014
Working at the Fed shouldn't be an audition for a Wall Street job. Waiting periods and other reforms are needed.

The Age of the Unthinkable
John Micklethwait and Adrian Wooldridge (WSJ) Sep 9, 2014
Tumultuous days in the world's democracies present an opening for conservative ideas to flourish.

Restructuring Debt Restructuring
Barry Eichengreen (Project Syndicate) Sep 9, 2014
Argentina's latest default was an episode from which no one – not the Argentine government, not the holdout investors that sued for full payment, and not US federal court judge Thomas Griesa, who ruled in favor of the "vultures" – emerged smelling like a rose. But sometimes the worst intentions yield the best results.

A New Trans-American Partnership
Ernesto Talvi (Project Syndicate) Sep 9, 2014
Rediscovering the spirit of the 1994 Summit of the Americas, where US President Bill Clinton and his Latin American counterparts set out a grand vision for the hemisphere, would benefit all. One way to revive that sense of common purpose would be to create a new Trans-American Partnership.

It's Not About the Money
Mark Blyth (FA) Sep 9, 2014
Why Scotland might just say yes to independence.

Scotland’s fateful choice
FT editors Sep 10, 2014
The case for union is overwhelming. The path of separation is a fool's errand, one fraught with danger and uncertainty.

Japan is creating jobs but not prosperity
David Pilling (FT) Sep 10, 2014
Casualisation of the labour market is stifling the reflationary experiment, and wages need to rise in line with inflation.

Scots vote poses threat to EU integration
Ralph Atkins (FT) Sep 10, 2014
Even if the Noes prevail, a close result would further threaten the gradual process of financial integration that has underpinned Europe’s development.

Europe’s bank bail-in rules change game
Tim Skeet (FT) Sep 10, 2014
Should investors’ due diligence indicate bank trouble on the horizon, they may find themselves in a bizarre game of cat and mouse with regulators.

Catalonia: Another country
Tobias Buck (FT) Sep 10, 2014
Spain is heading for a bitter political crisis as calls for independence from one of its most economically powerful regions come to a head.

WTO Members Return to Geneva, Hoping to Bridge TFA Gap
Bridges, Volume 18, Number 29 Sep 10, 2014
A flurry of meetings is scheduled for the coming weeks as WTO members – having now returned to Geneva following their annual August break – try to pick up the pieces after missing a key implementation deadline this past July.

US-Japan Farm Trade Divides Persist as TPP Chief Negotiators End Hanoi Meet
Bridges, Volume 18, Number 29 Sep 10, 2014
Chief negotiators from 12 Trans-Pacific Partnership (TPP) countries concluded a 10-day meeting in Hanoi, Vietnam, earlier today, in an effort to pare down some of their remaining differences. While progress was reported in some areas of the trade talks, a concurrent set of bilateral meetings in Tokyo between the US and Japan showed that the two sides remain at odds on the key issue of agricultural tariffs.

FAO: Ebola Outbreak Putting West African Trade, Food Security in Jeopardy
Bridges, Volume 18, Number 29 Sep 10, 2014
Disruptions in cross-border trade and marketing in the three West African countries most affected by the Ebola outbreak – Liberia, Sierra Leone and Guinea –have sent food prices soaring, threatening food security

Should the World Fund Food Aid to North Korea?
Marcus Noland (PIIE/Guardian) Sep 10, 2014
For nearly three decades a chronic food emergency has gripped North Korea. In the 1990s a famine killed up to 5 percent of the precrisis population.

The OECD must take charge of promoting long-term investment in developing country infrastructure
Sony Kapoor (OECD) Sep 10, 2014
The world of investment faces two major problems. Problem one is the scarcity – in large swathes of the developing world – of capital in general, and of money for infrastructure investments in particular. Problem two is the sclerotic, even negative rate of return on listed bonds and equities in many OECD economies.

How the Rich Rule
Dani Rodrik (Project Syndicate) Sep 10, 2014
Widening inequality in the world’s advanced and developing countries inflicts two blows against democratic politics. Not only does it lead to greater disenfranchisement of the middle and lower classes; it also fosters among the elite a poisonous politics of sectarianism.

Fighting the Fed Both Ways
Mark Gilbert (Bloomberg View) Sep 10, 2014
Even in this age of forward guidance, divining what central banks will do next remains an art rather than a science.

Ants Are Cool but Teach Us Nothing
Edward O. Wilson (Bloomberg View) Sep 10, 2014
The awesome superorganisms that ants form are built on instinctive labor specialization of a kind that could never occur in the human species.

Don't Let the Dark Ages Happen Here
Noah Smith (Bloomberg View) Sep 10, 2014
The Middle East was once a bastion of scientific enlightenment, but the rise of religion played a key role in turning the region into a cultural backwater.

Quantifying the macroeconomic effects of large-scale asset purchases
Karl Walentin (VoxEU) Sep 10, 2014
Central banks have resorted to various unconventional monetary policy tools since the onset of the Global Crisis. This column focuses on the macroeconomic effects of the Federal Reserve’s large-scale purchases of mortgage-backed securities – in particular, through reducing the ‘mortgage spread’ between interest rates on mortgages and government bonds at a given maturity. Although large-scale asset purchases are found to have substantial macroeconomic effects, they may not necessarily be the best policy tool at the zero lower bound.

To exit the Great Recession, central banks must adapt their policies and models
Marcus Miller and Lei Zhang (VoxEU) Sep 10, 2014
During the Great Moderation, inflation targeting with some form of Taylor rule became the norm at central banks. This column argues that the Global Crisis called for a new approach, and that the divergence in macroeconomic performance since then between the US and the UK on the one hand, and the Eurozone on the other, is partly attributable to monetary policy differences. The ECB’s model of the economy worked well during the Great Moderation, but is ill suited to understanding the Great Recession.

The humanitarian future
Paul Currion (Aeon) Sep 10, 2014
Can humanitarian agencies still fly the flag of high principle, or are they just relics of an imperial model of charity?

The world says No to Scottish separation
Philip Stephens (FT) Sep 11, 2014
The Yes campaign has replaced civic nationalism with identity politics in a cynical, bewildering and finite game.

Virtual drawbridge of fortress finance
Gillian Tett (FT) Sep 11, 2014
The big question is what might happen if Russian hackers stop feeling they have a stake in global finance or market stability.

Referendum poses threat to EU integration
Ralph Atkins (FT) Sep 11, 2014
Even if the Noes prevail, a close result would further threaten the gradual process of financial integration that has underpinned Europe’s development.

Eurozone must change mindset to survive
Stephen King (FT) Sep 11, 2014
Monetary policy alone will not be enough to solve the European single currency area’s deep-rooted problems.

The Inflation Cult
Paul Krugman (NYT) Sep 11, 2014
We're still trying to figure out the persistence and power of the people who keep predicting runaway inflation.

If Scotland Goes, Then Britain Too?
Jenny Anderson (NYT) Sep 11, 2014
As Scotland prepares to vote on independence on Thursday, British bankers worry about an exit from the European Union.

Preventing the Next Argentina
Jamila Trindle (FP) Sep 11, 2014
Efforts to fix the global debt system grind on with no quick fix.

On inequality - with any search for answers, it helps if people can first agree on the question
Kevin Murphy (Pieria) Sep 11, 2014
Income inequality is by no means a new concern but it is one that seems to have become increasingly controversial and politicised in recent years.

Will Currencies Undermine Calm in Markets?
Mohamed A. El-Erian (Bloomberg View) Sep 11, 2014
Currency gyrations could erode the financial stability that central banks have worked so hard to achieve.

Spain Should Beware Scottish Precedent
Mark Gilbert (Bloomberg View) Sep 11, 2014
Following the money suggests Catalonia is the most likely candidate to attempt to follow Scotland down the path to independence.

Monetary Policy Isn't Class Warfare
Ramesh Ponnuru (Bloomberg View) Sep 11, 2014
What the pundits are misunderstanding about the Federal Reserve.

Masters of Earth, Alone in the Universe
Edward O. Wilson (Bloomberg View) Sep 11, 2014
If humankind is to plan a more rational, catastrophe-proof future, we need to understand ourselves in both evolutionary and psychological terms.

Education and Opportunity
Lee Jong-Wha (Project Syndicate) Sep 11, 2014
In recent decades, a concerted effort from governments and international institutions has contributed to considerable progress in expanding educational opportunities and school-enrollment rates worldwide. But there is much more to be done, particularly with respect to improving the quality of education.

Parallels to 1937
Robert J. Shiller (Project Syndicate) Sep 11, 2014
The depression that followed the 1929 stock-market crash took a turn for the worse eight years later, and recovery came only with the enormous economic stimulus provided by World War II, a conflict that cost more than 60 million lives. The global situation today is not nearly so dire, but there are parallels, particularly to 1937.

High-Frequency Trading
Donald MacKenzie (LRB) Sep 11, 2014
Originally, the data needed for high-frequency trading travelled almost exclusively via fibre-optic cables, in which signals move at about two-thirds of the speed that light travels in a vacuum. But 125,000 miles per second isn’t fast enough if other market participants are faster. So there’s a race on.

Worth Its Weight
Daniel W. Drezner (NYT) Sep 12, 2014
A historian examines the rise of the gold standard and the economies that have embraced and abandoned it.

We Are All Quants Now
Paula Marantz Cohen (WSJ) Sep 12, 2014
What's 'like' got to do with it? A lot—but not everything.

Bolster the Export-Import Bank
C. Fred Bergsten (WP) Sep 12, 2014
We must fight fire with fire to end the latest export credit race.

Is Scotland Big Enough To Go it Alone?
Peter St. Onge (Mises Daily) Sep 12, 2014
Back when Quebec was weighing secession from Canada, I was a lowly American undergrad living in Montreal. It was an exciting time, since in America we have our railroads torn up and population starved when we secede. Now that Scotland is going through the motions, I figured I’d stir the pot, economically.

Europe's Weak Because It's Uncompetitive
Leonid Bershidsky (Bloomberg View) Sep 12, 2014
The new European competitiveness reports show that an inflexible labor market and overcautious banks are the EU economy's biggest problems.

Asia’s Democratic Dark Spots
Shashi Tharoor (Project Syndicate) Sep 12, 2014
Democracy in Asia lately has proved to be hardier than many might have expected, with free and fair elections enabling the large and divided societies of India and Indonesia to manage important political transitions. But some Asian democracies – notably, Thailand and Pakistan – seem to be losing their way.

Rapid growth in emerging markets and developing economies: Now and forever?
Giang Ho and Paolo Mauro (VoxEU) Sep 12, 2014
Forecasters often predict continued rapid economic growth into the medium and long term for countries that have recently experienced strong growth. Is this optimism warranted by past international growth experience? This column explores this question by looking at economic growth forecasts at longer-term horizons.

Is the ECB doing QE?
Charles Wyplosz (VoxEU) Sep 12, 2014
Last week, the ECB announced that it would begin purchasing securities backed by bank lending to households and firms. Whereas markets and the media have generally greeted this announcement with enthusiasm, this column identifies reasons for caution. Other central banks’ quantitative easing programmes have involved purchasing fixed amounts of securities according to a published schedule. In contrast, the ECB’s new policy is demand-driven, and will only be effective if it breaks the vicious circle of recession and negative credit growth.

Argentina Default Flashes Warning to Emerging Markets
Will Hickey (YaleGlobal) Sep 12, 2014
Struggle of countries like Argentina for orderly default mired in Western financial and legal system

Economic convergence: The headwinds return
Economist Sep 13, 2014
Ten years ago, developing economies were catching up with developed ones remarkably quickly. It was an aberration

International reserves before and after the Global Crisis: Is there no end to hoarding?
Joshua Aizenman, Yin-Wong Cheung and Hiro Ito (VoxEU) Sep 13, 2014
In the aftermath of the global financial crisis new patterns of reserve hoarding have emerged. This column identifies structural changes in international reserve accumulation. Emerging markets with higher savings rates tend to use higher buffers of reserves, partially accounting for the higher levels of reserves in east Asia compared to Latin America. While there is no end in sight for reserve hoarding, some of the newly identified factors may mitigate eventual reserve accumulation.

Eurozone recovery: there are no shortcuts
Roberto Perotti (VoxEU) Sep 13, 2014
There is a growing consensus that austerity is contributing to the Eurozone’s macroeconomic malaise, but also that spending cuts are needed in the long run to achieve fiscal sustainability. Some commentators have advocated a temporary tax cut financed by unsterilised ECB purchases of long-term public debt, accompanied by a commitment to future spending cuts. This column argues that such commitments are simply not credible – especially given the moral hazard problem created by central bank monetisation of debts.

Big Tech at Bay
Richard Waters (FT) Sep 14, 2014
Silicon Valley’s era of untrammelled global expansion is over, as backlash grows against the power and reach of US technology companies.

Divisions behind declining EU influence
Wolfgang Munchau (FT) Sep 14, 2014
The eurozone has been running on luck – a commodity about which little is certain expect that tends not to last.

Business and the costs of independence
FT editors Sep 14, 2014
The termination of the 300-year-old single market will raise prices and hit employment.

Venezuela Heads to a Default Reckoning
Mary O'Grady (WSJ) Sep 14, 2014
Amid bills for imports and debt servicing, and shrinking dollar liquidity, something has to give.

China’s ‘creeping invasion’
Jackson Diehl (WP) Sep 14, 2014
The ambitious nation takes its time targeting the global order.

Exchange rate pass-through in developing and emerging markets
Janine Aron and John Muellbauer (VoxEU) Sep 14, 2014
Due to the adoption of inflation targeting and floating exchange rates, and the elimination of capital controls, exchange rate pass-through – the transmission of exchange rate movements to changes in the domestic price level – has become an increasingly important issue in developing and emerging market economies. This column discusses recent research on this topic, and highlights the frequent misspecifications that produce unreliable empirical estimates.

Vibrant nationalism fights shy unionism
Philip Stephens (FT) Sep 15, 2014
The years since the financial crash have been as dismal for the Scots as for most of Britain. How much easier it is to champion a brave new future.

China’s rise is a credit to private enterprise
Nicholas Lardy (FT) Sep 15, 2014
Those critics who attribute the country’s economic ascent to the hidden hand of Beijing are wrong and risk losing out on the benefits.

Banya, Bear and Birch: Bank risks abroad
Tom Braithwaite (FT) Sep 15, 2014
Investors have proved stoical but here has been a relative shift away from those banks that are more exposed to geopolitical uncertainty.

Fed should raise rates sooner than later
Andrew Wilson (FT) Sep 15, 2014
The plan to proceed gradually raises the risk that the Fed may later have to move more aggressively than it envisions now, creating new challenges.

The Huge Costs of Scotland Getting Small
Adam S. Posen (PIIE/scotsman) Sep 15, 2014
As the song says, "Don't it always seem to go that you don't know what you've got 'til it's gone." The Scottish push for secession from the United Kingdom takes for granted the benefits of peaceful, deep, economic, social, and political integration, all of which will indeed start to go following a Yes vote.

The Explosive Growth of the Mobile Economy will Change the World
Darrell M. West & Joshua Bleiberg (Brookings) Sep 15, 2014
These smart policies can help the $1.6 trillion mobile economy reach its full potential in the years ahead.

Will the Fed Avoid a 'Language Tantrum'?
Mohamed A. El-Erian (Bloomberg View) Sep 15, 2014
Mohamed El-Erian explores the challenges the Fed faces in communicating interest rate policy and its economic outlook during this week's FOMC meetings.

India and China Should Let Trade Do the Talking
Dhiraj Nayyar (Bloomberg View) Sep 15, 2014
When they meet, the leaders of India and China should talk more about a problem they can solve -- trade -- than their intractable border disputes.

Bad Loans Could Bust China
William Pesek (Bloomberg View) Sep 15, 2014
The real threat to the world economy isn't a stagnating Europe -- it's China, where bad loans threaten a catastrophic bust.

Size Doesn't Matter
Fiona Hill and Jeremy Shapiro (FA) Sep 15, 2014
Why Scotland won't be Europe's last region to seek independence.

A future in the EU? Reconciling the ‘Brexit’ debate with a more modern EU
Barbara Böttcher and Eva Schmithausen (DB Research) Sep 15, 2014
The future of the British EU membership has become one of the most pressing concerns for the EU. The EU-British relationship has always been one of special character but a number of recent developments have led to a ‘Brexit’ gaining momentum. Only the UK itself will be able to rationalise the domestic debate on EU membership. Economically, Britain and the EU are inextricably linked. Realistic estimates predict losses in the range of 1 to 3% of British GDP in case of a Brexit. Likewise, the Single Market would shrink by 15%.

Debt threatens India’s fragile recovery
James Crabtree (FT) Sep 16, 2014
Risk remains that unexploded debt bombs could go off suddenly, damaging confidence in the country’s financial system and its fragile recovery.

The looking-glass world of Fed-watchers
FT Sep 16, 2014
In the long run, the state of the economy will prove more important than language on rates in determining the Fed’s actions.

Bloomberg View
James Gibney (Bloomberg View) Sep 16, 2014
China needs to dig a little deeper if it wants to build up its soft power.

Credit Gets You a TV, Not Economic Growth
Noah Smith (Bloomberg View) Sep 16, 2014
Everyone seems to believe that easy and expanding credit fuels economic growth, even though there's no proof that it does.

What Happens If China Becomes Japan?
Megan McArdle (Bloomberg View) Sep 16, 2014
By all normal indicators, China should be headed for a massive setback.

The G-20 to the Rescue?
Wayne Swan (Project Syndicate) Sep 16, 2014
The G-20’s upcoming meeting in Brisbane, Australia, comes at a time when a precarious global economy requires big decisions to be made. But it is far from clear who will provide the decisive voice needed to set a bold agenda – and then shepherd its implementation.

Vanguard Scotland?
Robert Skidelsky (Project Syndicate) Sep 16, 2014
Whichever way the Scottish independence referendum goes, the spectacular rise of nationalism, in Scotland and elsewhere in Europe, is a symptom of a diseased political mainstream. It is what happens when a form of politics claims to satisfy every human need except the coziness of communal belonging – and then lets the people down.

The Price of Scottish Independence
Jeffrey D. Sachs (Project Syndicate) Sep 16, 2014
The costs of secession are a matter of choice, not of inevitability. If cool heads prevail on all sides, Scottish independence could proceed at a relatively low cost, sparing the successor states, the EU, and other parts of the world considerable instability.

Markets’ Rose-Tinted World
Mohamed A. El-Erian (Project Syndicate) Sep 16, 2014
This has been an unusual year for the global economy, characterized by a series of unanticipated economic, geopolitical, and market shifts – and the final quarter is likely to be no different. So why are financial markets behaving as if they were in a world of their own?

The Government Europe Deserves?
Daniel Gros (Project Syndicate) Sep 16, 2014
The most sobering message from the appointment of the EU's new leadership is that the member states will not suffer anyone who might rock the boat and push integration forward. That might come as a relief for those fearing domination by Brussels, but it can only dismay those who hope that Europe can become a relevant global actor.

Inequality at the Top: Why Should We Care?
Richard V. Reeves (Brookings) Sep 16, 2014
What happens when the poor are keeping up with the majority, but the majority are falling behind the elite?

Fighting Inequality in the New Gilded Age
K. Sabeel Rahman (Boston Review) Sep 16, 2014
Campaign finance reform won't solve the problem. American citizens need a meaningful role in governing.

The Truth About Taxes
Matt Mossman (FA) Sep 16, 2014
How to close the loopholes on multinationals.

EU trade deals with developing nations: Missed opportunities
Jaime de Melo and Julie Regolo (VoxEU) Sep 16, 2014
The EU is about to extend economic partnership agreements signed in 2007 with countries of the Africa, Caribbean and Pacific region. Reflecting on the implementation difficulties associated with previous agreements and the minimal engagements in the upcoming ones, this column argues that these partnerships will fall short. No further integration of African economies will come out of them. Economic Partnership Agreements will have been a sideshow in the EU’s trade policy.

The Last Mile in Ending Extreme Poverty
Laurence Chandy and Homi Kharas (USAID/Brookings) Sep 16, 2014
Can extreme poverty be ended by 2030—and if so, what will it take?

Scotland needs bravery to build strong banks
John Gapper (FT) Sep 17, 2014
Experience has taught the country that the mechanisms that it will need as an independent entity it needs will take courage and a lot of time.

Scots’ choice: independence or sterling
Krishna Guha (FT) Sep 17, 2014
Scots wants full independence, financial stability and deep economic integration with the UK. They can have any two but not all three.

Economic soufflé at risk of implosion
Jay Pelosky (FT) Sep 17, 2014
While the production side of the US economy appears robust, the same cannot be said for the rest of the world, which lacks an economic locomotive.

Scotland Decides: Smaller Nations in a Big World
Globalist Sep 17, 2014
How will an independent Scotland compare to other small nations?

High-Frequency Firm Found Clever Way to Save on Capital
Matt Levine (Bloomberg View) Sep 17, 2014
By just rewriting the net capital rules, I mean. They had a better system, so they used it. The SEC did not approve.

The Economics of Violence
Bjørn Lomborg (Project Syndicate) Sep 17, 2014
Given the brutal conflicts in Syria, Ukraine, and elsewhere that are constantly in the news, many people would probably say that war is the largest source of violence in the world. But that turns out to be spectacularly wrong.

The System is Working
Daniel W. Drezner (Project Syndicate) Sep 17, 2014
As the G-20 meeting of finance ministers starts in Cairns, Australia, the Legion of Gloom is at it again, claiming that the system of global governance structures ranging from the WTO and the G-20 to the major central banks is in desperate need of repair. In fact, the global economic order has worked remarkably well since 2008.

Revamping Europe’s Tattered Social Contract
Kemal Dervis (Project Syndicate) Sep 17, 2014
Europe's economy needs deep supply-side reforms, so that fiscal stimulus translates into sustainable long-term growth, not just temporary spurts and further increases in countries’ debt ratios. But too many call for structural reforms without specifying their content or considering the social, historical, and political context.

India’s Soft Power Advantage
Kadira Pethiyagoda (Diplomat) Sep 17, 2014
Deeply entrenched factors make India a uniquely attractive great-power partner.

Prometheus unbound? The modest benefits of entry deregulation in Portugal
Lee Branstetter, Francesco Lima, Lowell Taylor and Ana Venâncio (VoxEU) Sep 17, 2014
Business groups and their political allies advocate deregulation as a pathway to faster growth, pointing to a strong negative relationship between regulatory barriers to entry and economic performance. This column argues that cross-sectional estimates have oversold the strength of this relationship and its implications for policy. Quasi-experimental evidence from a Portuguese policy reform shows that deregulation matters, but its impact is limited – it is not the panacea that pundits proclaim it to be.

Entry and exit in OTC derivatives markets
Andy Atkeson, Andrea Eisfeldt and Pierre-Olivier Weill (VoxEU) Sep 17, 2014
Entry and trading in over-the-counter (OTC) derivatives markets have received considerable attention. However, many critical questions remain unaddressed. This column describes a formal study of banks’ incentives to enter and trade in OTC derivatives markets. In equilibrium, only large banks enter to become dealers, and middle-sized banks only enter as customers. Care should be given not to reduce rents so much when dealer participation costs are high.

Doubling Down on Democracy
Michael Ignatieff (Atlantic) Sep 17, 2014
Francis Fukuyama is still bullish on where history is headed, but Americans should worry: republics can decay.

Made in America, Again
James Fallows (Atlantic) Sep 17, 2014
Three big trends that could shape the future of high-tech manufacturing—and the middle class.

Scotland’s Independence Vote Shows a Global Crisis of the Elites
Neil Irwin (NYT) Sep 18, 2014
A push for independence is driven by a discontent with the ruling class that applies to varying degrees in the United States and, especially, the eurozone.

Pay pressure
Chris Giles, Sarah O’Connor, Claire Jones and Ben McLannahan (FT) Sep 18, 2014
Rich countries have lost the knack of improving middle class living standards. The Financial Times polled economists from across the political spectrum for their ideas to jump-start wage growth.

Emerging markets brace for a bumpy ride
Gillian Tett (FT) Sep 18, 2014
The increasing role of asset managers is a striking – and risky – change in the credit ecosystem.

Negative interest rates far from absurd
Ralph Atkins (FT) Sep 18, 2014
The need for action against eurozone deflation threats has forced out the boundaries of financial economics.

The Next Stage of Abenomics Is Coming
Shinzo Abe (WSJ) Sep 18, 2014
Make no mistake, Japan will emerge from economic contraction and carry out needed structural reforms.

EU, Ukraine Parliaments Ratify Trade Deal
Bridges, Volume 18, Number 30 Sep 18, 2014
The European and Ukrainian parliaments ratified their bilateral trade deal on Tuesday. The landmark votes, which were conducted simultaneously in Strasbourg and Kiev and streamed through a joint video link, came following a turbulent year that saw Western ties with Russia fall to their lowest point in decades amid an outbreak of violence in Ukraine.

Azevêdo Warns WTO Members of "Precarious" Situation as TFA, Food Stockholding Talks Resume
Bridges, Volume 18, Number 30 Sep 18, 2014
A resolution to the deadlock over whether to link the implementation of the WTO's Trade Facilitation Agreement (TFA) to finding a permanent solution on public food stockholding is still "far from evident," Director-General Roberto Azevêdo told ambassadors in Geneva on Monday afternoon.

India Reports Farm Subsidies Beneath Current WTO Ceilings
Bridges, Volume 18, Number 30 Sep 18, 2014
India has reported that its trade-distorting support consistently fell below WTO ceilings, or was exempt from these limits, according to new figures covering a seven-year period up to 2010-11.

UN Members Weigh Post-2015 Development Agenda Progress
Bridges, Volume 18, Number 30 Sep 18, 2014
UN Secretary-General Ban Ki-moon urged UN members last Thursday to make a final push to achieve the eight Millennium Development Goals (MDGs) by their 2015 target date, and to simultaneously work toward building a development roadmap for the years ahead.

The Fed's Risky Bet on Growth
Mohamed A. El-Erian (Bloomberg View) Sep 18, 2014
The Fed is making a risky bet that Congress and companies will do their part to get the economy out of the doldrums.

ECB Throws a Party, Nobody Shows Up
Mark Gilbert (Bloomberg View) Sep 18, 2014
By introducing liquidity programs he knows are doomed to fail, Mario Draghi is slowly seducing the Bundesbank into sanctioning quantitative easing.

In Praise of China’s New Normal
Yao Yang (Project Syndicate) Sep 18, 2014
China’s economy is, at long last, undergoing a rebalancing, with growth rates having declined from more than 10% before 2008 to roughly 7.5% today. If this is China’s "new normal," it would still be the envy of the rest of the world.

What Water’s Worth
Asit K. Biswas and Ahmet C. Bozer (Project Syndicate) Sep 18, 2014
Nearly 200 years ago, Lord Byron wrote, “Till taught by pain, men really know not what good water’s worth.” Humanity still has not fully grasped water’s value, but the impending water crisis is becoming increasingly difficult to ignore – especially for those who are already feeling its effects.

Great Cities and Ghost Towns
Andrew Sheng and Xiao Geng (Project Syndicate) Sep 18, 2014
Many observers tend to regard the rise of unoccupied modern “ghost towns,” funded through risk-laden local-government financing vehicles (LGFVs), as symptoms of China’s coming collapse. But this view underestimates the inevitability – indeed, the necessity – of such challenges on the path to development.

Piketty’s Missing Rentiers
Jeffrey Frankel (Project Syndicate) Sep 18, 2014
Thomas Piketty predicts that interest rates will rise substantially above the growth rate, capital will accumulate, and the rich will get richer through inheritance and capital income, rather than through outlandish salaries and stock options. But unearned income is not what is driving the current rise in inequality.

Using happiness data in policy making
Angus Deaton (OECD Insights) Sep 18, 2014
The happiness revolution is in full swing. Country statistical offices are beginning to collect data on wellbeing, the OECD has prepared a manual on how best to do it, and politicians are promising to focus, not just on economic growth and better material living standards, but on the much wider range of things that are important to people. This broadening of policy is much to be welcomed.

India's Factory Future
Dhiraj Nayyar (Bloomberg View) Sep 18, 2014
India does need to develop a manufacturing sector like China's, but it doesn't have to follow China's model.

Deep roots matter for prosperity, but so do current policies
Mercedes Delgado, Christian Ketels, Michael Porter and Scott Stern (VoxEU) Sep 18, 2014
There is a consensus among economists that ‘deep roots’ – geography, natural endowments, and institutions – are important determinants of prosperity differences across countries. This column argues that deep roots matter, but they are neither the whole story nor an excuse for political inaction today. Current policies are important – especially the broad range of policies that shape the business environment and the sophistication of companies – and they are affected but not determined by the past.

Flying High
Jim Krane (FA) Sep 18, 2014
The improbable rise of the gulf airlines.

To Save the Planet, Don't Plant Trees
Nadine Unger (NYT) Sep 19, 2014
Reforestation might seem like a simple solution to climate change, but the science shows it could make global warming worse.

One Big Unhappy Economy
NYT Sep 19, 2014
Global growth that is “job-rich and inclusive” is possible in theory; politically, not so much.

Great Britain Sticks Together—Heading Where?
Quentin Letts (WSJ) Sep 19, 2014
So that's the end of the Salmond run. Cameron still has a long way to go.

The Scottish Vote and Europe’s Future
Holger Schmieding (Globalist) Sep 19, 2014
Scotland votes for more home rule within the UK, not independence.

The UK’s Problems Have Just Begun
Denis MacShane (Globalist) Sep 19, 2014
Far from settling everything, the Scottish vote has opened everything up.

Who Is the World's Most Important Central Banker?
William Pesek (Bloomberg View) Sep 19, 2014
As the Fed tapers, the most important central banker in the world may no longer be America's, but China's.

Gaelic Lessons for the Rest of Europe
Mark Gilbert (Bloomberg View) Sep 19, 2014
Valuable lessons abound in the aftermath of the Scottish referendum on independence, both for regions that would secede and for the nations or institutions that would prefer to maintain a status quo.

Small Countries’ Big Successes
Michael O’Sullivan and Stefano Natella (Project Syndicate) Sep 19, 2014
Roughly 75% of today’s small countries were formed in the last 70 years, mostly as a result of broader democratic transitions and in tandem with trade growth and globalization. Their successes and failures are more germane to current discussions than, say, the fiscal implications of Scottish independence.

Europe’s Bargain
Michael Spence (Project Syndicate) Sep 19, 2014
Eurozone member countries should implement fiscal and structural reforms in exchange for short-run relaxation of fiscal constraints – not to increase liabilities, but to focus on growth-oriented investments to jump-start sustained recovery. If they do, private investors would take note, accelerating the recovery process.

Social norms and the enforcement of laws
Daron Acemoglu and Matthew O. Jackson (VoxEU) Sep 19, 2014
Social norms shape interactions but can be in conflict with new laws, often making such laws ineffective. This column presents new research on the interplay of laws and norms. High law-breaking induces less private cooperation, increasing the law-breaking further. For a successful change in behaviour, gradual imposition of new laws is recommended. An important aspect is that these new laws should not be in a strong conflict with the existing norms.

In Scotland and Beyond, a Crisis of Faith in the Global Elite
Neil Irwin (NYT) Sep 20, 2014
The independence movement in Scotland was another sign of widespread dissatisfaction with an established order that has failed to deliver.

Five Lessons Learned from the Scottish Referendum
Ryan McMaken (Mises Daily) Sep 20, 2014
Government authorities in the UK have declared that the “Yes” campaign for secession has failed by a margin of approximately 55 percent to 45 percent. Yet, even without a majority vote for secession, the campaign for separation from the United Kingdom has already provided numerous insights into the future of secession movements and those who defend the status quo.

Systemic risk in Europe
Robert Engle, Eric Jondeau and Michael Rockinger (VoxEU) Sep 20, 2014
With the recent Global Crisis, the interest in systemic risk and the interconnection between financial institutions has increased. This column investigates the case of European financial firms, where several factors can jeopardise a firm’s financial health. Using data since 2000 to evaluate the firms’ systemic risk, the authors find that for certain countries, the cost to rescue the riskiest domestic banks is too high. They might be considered too big to be saved.

Finance at the speed of light
Marius Zoican (VoxEU) Sep 20, 2014
Technological advances in equity markets entered the spotlight following the Flash Crash of May 2010. This column analyses the advantages and disadvantages of algorithmic and high-frequency trading. Ever-faster exchanges do not always improve liquidity. Following a speed upgrade in the Nordic equity markets, effective spreads posted by high-frequency traders increased by 32%.

Italy debt is a problem for us all
Wolfgang Munchau (FT) Sep 21, 2014
We need a lot of extreme and co-ordinated policy action to make it possible for Italy to grow, service debt and ultimately stay in the eurozone.

‘Emerging Africa’, by Kingsley Chiedu Moghalu
Katrina Manson (FT) Sep 21, 2014
This homegrown guide to an African future offers a vision for the continent’s development that sheds several clichés.

Narendra Modi tackles India Licence Raj
Amy Kazmin (FT) Sep 21, 2014
Analysts say making life easier for companies is a logical first step towards attracting more investment to manufacturing industry.

The West's Bruised Confidence in Capitalism
Donald Baer (WSJ) Sep 21, 2014
A new global survey finds that only 36% of Americans see corporations as a source of 'hope.' In China it's 84%.

Why is Thomas Piketty's 700-page book a bestseller?
Heidi Moore (Guardian) Sep 21, 2014
Thomas Piketty is a French economist whose Capital in the Twenty-First Century has swept American discourse. Four experts – Brad DeLong, Tyler Cowen, Stephanie Kelton and Emanuel Derman – take on why that is

The strange revival of nationalism
Gideon Rachman (FT) Sep 22, 2014
In a borderless world of bits and bytes the traditional concerns of nations looked anachronistic but politicians and voters seem unaware.

China’s leadership needs entrepreneurs
Henny Sender (FT) Sep 22, 2014
Entrepreneurs such as Alibaba’s Jack Ma are transforming the economic landscape of China, generating jobs and making the country a far fairer place in the process.

How Ireland’s Nama moved centre stage
Vincent Boland (FT) Sep 22, 2014
The bad bank is arguably the country’s most important financial institution and is looming large in its latest drama.

Behind the Fed's Dovish Turn on Rates
Alan S. Blinder (WSJ) Sep 22, 2014
After sending hawkish signals in July, the Federal Open Market Committee has softened its tone.

High Hopes for Russia Are Fading on Wall St.
Andrew Ross Sorkin (NYT) Sep 22, 2014
Russia, which was supposed to be a growth market for Wall Street, is turning out to be a potential financial and political nightmare amid the Ukraine situation and America’s sanctions.

How to Fix Our Financial Early-Warning System
Bloomberg View Sep 22, 2014
Markets are again showing signs of excess. Regulators need to know where the risks are concentrated.

China’s Measured Embrace of India
Minghao Zhao (Project Syndicate) Sep 22, 2014
Chinese President Xi Jinping's visit to India strongly suggests that China is determined to inhibit the bilateral rivalry from intensifying. But, despite Xi’s investment pledges, it is far from certain that Asia’s two giants can bridge the differences that continue to burden the bilateral relationship.

Burning Down the House
Donald Kaberuka (Project Syndicate) Sep 22, 2014
World leaders must act on all global challenges when they recognize them. Preventing bank failures and stopping terrorist attacks are important goals; unless we get serious about addressing climate change, we are likely to have more of both.

Irrational Exuberance Down Under
William Pesek (Bloomberg View) Sep 22, 2014
Housing is one of the three main pillars of the Australian economy. Unfortunately, all three are dangerously vulnerable to a Chinese slowdown.

Mr Draghi, is it really that difficult to see?
Robin Fransman (Pieria) Sep 22, 2014
Four years into the Euro-crisis, and the true faults of the Eurozone are finally sinking in. Except one.

Are you sure your benchmark index is doing the job you think it is?
Kevin Murphy (Pieria) Sep 22, 2014
Investors should handle market indices with care and certainly not take them at face value.

Micro evidence on Chinese outward direct investment
Heiwai Tang and Wenjie Chen (VoxEU) Sep 22, 2014
Using a new, unique, and comprehensive data set that covers close to 19,000 Chinese ODI deals from 1998 to 2011, we find that in contrast to the common perception, over half of the ODI deals are in service sectors, with many of them appearing to be related to export promotion. Ex ante larger, more productive, and more export-intensive firms are more likely to start investing abroad. Ex post, ODI appears to enhance firm performance (i.e., total factor productivity, employment, export intensity, and product innovation). Empirical analysis based on firms’ trade transaction data shows a significantly positive effect of ODI on firms’ trade performance, but little technology transfer.

Taxes: vague benefits create temptations
Alison Smith (FT) Sep 23, 2014
Tougher regulations are needed to sweep away the weak accountancy rules and hubris that could be at the heart of the supermarket group’s overstatement.

The epidemic the world could have stopped
Anjana Ahuja (FT) Sep 23, 2014
Surviving other globe-threatening ailments might be down to luck not competence.

Clean growth is a safe bet
Martin Wolf (FT) Sep 23, 2014
With the right support from governments, a low-carbon future need not be one of perpetual misery.

Commodities: Cereal excess
Gregory Meyer (FT) Sep 23, 2014
Bumper harvests have sent global grain supplies soaring, resulting in lower incomes for farmers and an eventual slowing of food price inflation.

Ten Lessons from the Scottish Referendum
Jacob Funk Kirkegaard (PIIE) Sep 23, 2014
The 55 percent majority that rejected Scottish independence was perhaps not so lopsided as to banish all Scottish nationalist dreams of another vote someday. But it was more decisive than many opinion polls had predicted. At least 10 lessons can be drawn from the process.

Biggest Losses Start With Brilliance
Barry Ritholtz (Bloomberg View) Sep 23, 2014
When the Fed bailed out the hedge fund Long Term Capital Management in 1998, it set the precedent for the Wall Street bailout almost 10 years later.

The G-20's Triumph and Tragedy
Mohamed A. El-Erian (Bloomberg View) Sep 23, 2014
The G-20 knows what the global economy needs. Too bad it can't do it.

Rebooting Globalization
Martina Larkin (Project Syndicate) Sep 23, 2014
For all of its undeniable benefits, globalization has spawned problems of governance and management that have exposed the inadequacy of national governments and international institutions. And fragile institutions have given rise to a political backlash and the danger of disaster on many fronts.

Germany’s Economic Mirage
Philippe Legrain (Project Syndicate) Sep 23, 2014
For 60 years, successive German governments sought a more European Germany; but now, Chancellor Angela Merkel’s administration wants to reshape Europe's economies in Germany’s image. This would be a disaster: Far from being Europe’s most successful economy – as German officials boast – Germany’s economy is dysfunctional.

Silk Road Diplomacy - Twists, Turns and Distorted History
Tansen Sen (YaleGlobal) Sep 23, 2014
China harkens the Silk Road in foreign policy initiatives, but the history is less benign.

The Alibaba moment
Robert J. Samuelson (WP) Sep 24, 2014
We will see more Chinese firms venturing onto the world stage.

Corruption is messy for business in Asia
David Pilling (FT) Sep 24, 2014
Managers have to figure out how to avoid paying bribes – or how to pay without being caught.

Real reforms needed to sustain EM growth
Patrick Zweifel (FT) Sep 24, 2014
When demand is strong, reforms are quietly shelved.

Leaders must opt to save the Earth
Jeffrey Sachs (FT) Sep 24, 2014
There is a narrow path to climate safety, which requires a well-funded effort to develop low-carbon technologies.

The epidemic the world could have stopped
Anjana Ahuja (FT) Sep 24, 2014
Surviving other globe-threatening ailments might be down to luck not competence

Property: Land of opportunity
Robin Harding (FT) Sep 24, 2014
To its advocates, land value tax has almost magical powers. Has its moment finally come?

The World’s Largest Subprime Debtor: The US Government
David Howden (Mises Daily) Sep 24, 2014
Lehman Brothers filed for Chapter 11 bankruptcy protection six years ago this month. The event has become famous as the spark that ignited the global financial crisis. Since that date, millions have lost their jobs and livelihoods, and countless others have seen their futures evaporate before their eyes, sometimes permanently.

The Right Direction for Scotland
Avinash D. Persaud (Livemint/PIIE) Sep 24, 2014
If 200,000 voters, or 5 percent of the electorate, had switched their minds and voted "yes" rather than "no," the United Kingdom would have been no more after the Scottish referendum on September 18, 2014. The long dismantling of the British Empire would be at an end, a process that began with Indian Independence in 1947. To add irony, the Scots often played pivotal roles in the establishment and running of that Empire on which, for a while, the sun never set. Not just the residents of Kolkata will know of Duff College and the Roxburgh Building.

Japan's Debt Trap
Noah Smith (Bloomberg View) Sep 24, 2014
Japan has more debt than any developed nation and resolving it poses from unwelcome choices.

Xi Jinping’s Pure Party
George Magnus (Project Syndicate) Sep 24, 2014
While the Chinese authorities' efforts to root out corruption within the Communist Party are a welcome development, the Party itself is part of the problem. The true test of change will be whether the Party is prepared to subordinate itself to new, inclusive institutional arrangements that are conducive to comprehensive economic reform.

“Whatever It Takes” in Ukraine
Jorge Mariscal and Nick Rice (Project Syndicate) Sep 24, 2014
Europe’s efforts to revive its economy and confront the crisis in Ukraine may seem to be two entirely separate challenges. But policymakers, struggling to contain Russia and find an acceptable long-term settlement on Europe's eastern borders, could learn a lot from the way ECB President Mario Draghi has managed to stabilize the eurozone.

Statement of the participants in the Third EU-Asia Rountable
Bernard Hoekman and Christopher Findlay (VoxEU) Sep 24, 2014
The evolution of the world trading system no longer supports the delivery of opportunities that follow from innovations in international business. This column is a statement by participants at a roundtable held in the EU Centre for Global Affairs, University of Adelaide, on 22 August 2014, which offers suggestions to improve global trade governance. Given that Australia is hosting the G20 Summit in November, the roundtable focused on actions that the G20 should consider to help attain its objective of boosting global growth performance.

Latin America: The archetypal financial crisis
Tom Streithorst (Pieria) Sep 24, 2014
The Latin American debt crisis remains the best teaching tool we have to explain the workings of the modern financial system.

The other half
Claire Melamed (Aeon) Sep 24, 2014
To end inequality, we must realise that it isn’t about the rich, it’s about the poor. And we know almost nothing about them

Manufacturing’s clean-up: Technology not offshoring
Arik Levinson (VoxEU) Sep 24, 2014
Pollution emitted by manufacturers has been falling in Europe and the US. A concern with this clean-up is that developed countries have been offshoring the production of pollution-intensive parts and products. This column presents evidence refuting this concern. Using a new approach, the author calculates that almost all of the clean-up in US manufacturing can be explained by technological changes.

Fast trains and firm performance: New Japanese evidence
Andrew B. Bernard, Andreas Moxnes and Yukiko Umeno Saito (VoxEU) Sep 24, 2014
Investment in high-speed rail accounts for billions in investment worldwide, but little research has been done on its effect on firm performance. This column introduces a model of firm supply networks, and presents evidence from the opening of an extension to the Shinkansen railway in Japan. The authors show that input-intensive industries benefit relatively more. In addition, their model provides a microfoundation for differential productivity across regions.

G20 credibility depends on its trade agenda: Statement of the participants in the Third EU-Asia Rountable
Bernard Hoekman & Christopher Findlay (VoxEU) Sep 24, 2014
The evolution of the world trading system no longer supports the delivery of opportunities that follow from innovations in international business. This column is a statement by participants at a roundtable held in the EU Centre for Global Affairs, University of Adelaide, on 22 August 2014, which offers suggestions to improve global trade governance. Given that Australia is hosting the G20 Summit in November, the roundtable focused on actions that the G20 should consider to help attain its objective of boosting global growth performance.

Closed Door Policy
Joshua Eisenman (FA) Sep 24, 2014
How China's reforms are pushing away foreign business.

Fairer markets that will serve us all
Minouche Shafik (FA) Sep 25, 2014
A new review aims to monitor the heart of the financial system.

Robots are our saviours, not the enemy
Peter Thiel (FT) Sep 25, 2014
The alternative is a world in which wages fall and prices rise

Falling commodities flash global warning
Ralph Atkins (FT) Sep 25, 2014
Price slide reveals mounting concern about China.

Russia: Putin’s power politics
Courtney Weaver (FT) Sep 25, 2014
The arrest of Yevtushenkov has rattled oligarchs who thought close ties to the Kremlin would keep them safe.

The Good Order
David Brooks (NYT) Sep , 2014
The arduous work of imposing order is critical to success in any realm, from the international state system to one's own mind.

An Invitation to 'Make in India'
Narendra Modi (WSJ) Sep 25, 2014
With 800 million people under age 35, we are a nation ready for rapid, responsible economic development.

World Leaders Outline Plans to Tackle Climate Change
Bridges, Volume 18, Number 31 Sep 25, 2014
Tuesday's much-anticipated UN climate summit in New York saw 125 heads of state take the opportunity to highlight their national climate efforts, while unveiling a raft of new financial commitments in this area.

EU, East Africa Sign Trade Deal, Bringing EPA Process Near Close
Bridges, Volume 18, Number 31 Sep 25, 2014
The five members of the East African Community (EAC) – Burundi, Kenya, Rwanda, Tanzania, and Uganda – signed the draft version of their Economic Partnership Agreement (EPA) with the EU on 20 September. With Brussels having already concluded two other such agreements involving African country blocs in July, this latest deal brings to a close a long negotiation process between the main African regional economic communities and Europe.

WTO Chief Warns of Potential "Freezing Effect" as TFA, Food Stockholding Deadlock Persists
Bridges, Volume 18, Number 31 Sep 25, 2014
Failing to resolve the impasse over whether to link implementation of the WTO's Trade Facilitation Agreement (TFA) with finding a permanent solution on public food stockholding could pose grave consequences for the global trade body, including for efforts to resolve the Doha Round trade talks, Director-General Roberto Azevêdo said this week.

WIPO Assemblies Aim to Advance Norm-Setting, Amid Governance Questions
Bridges, Volume 18, Number 31 Sep 25, 2014
The World Intellectual Property Organization's (WIPO) annual high-level meetings kicked off on Monday in Geneva, Switzerland, with this year's Assemblies set to tackle a broad range of issues facing the 187-member organisation, particularly in the area of norm-setting.

Why S&P’s Latest Call on Germany Misses the Mark
Holger Schmieding (Globalist) Sep 25, 2014
Why the emergence of some right-wing populists will not paralyze Germany’s pro-euro policies.

The Atlantic Civilization and Its Enemies
Ludger Kuhnhardt (Globalist) Sep 25, 2014
Squeezed between a self-destructive Russia and Arab world, Western nations need to focus on their roots.

Grave New World
Javier Solana (Project Syndicate) Sep 25, 2014
The world is changing more profoundly and rapidly than ever before. Maintaining global stability will demand renewed multilateral institutions in which countries defend their principles while respecting those of others – and never lose sight of their shared interests and objectives.

Disciplining the Sharing Economy
Ayesha Khanna and Parag Khanna (Project Syndicate) Sep 25, 2014
The increasing ability of people to exchange goods, services, and labor directly, via online platforms, is transforming how modern economies operate. But to ensure that the rise of the “sharing economy” works efficiently and improves conditions for all parties, some regulation is needed.

Can Modi Make It Rain?
Dhiraj Nayyar (Bloomberg View) Sep 25, 2014
Unlike his other recent bilateral meetings, Indian Prime Minister Narendra Modi isn't likely to return from the U.S. with billion-dollar investment deals. And it's India's own fault.

Outsourcing and the shift from manufacturing to services
Giuseppe Berlingieri (VoxEU) Sep 25, 2014
Advanced nations are shedding manufacturing jobs and gaining service jobs – a trend that has been in place for decades. Some of the shift, however, is a reclassification effect. Corporate outsourcing of tasks like marketing means workers doing the same task as before now show up as working for a firm in the service sector. Using US data from the past 60 years, this column shows that the evolution of the input-output structure – which is mostly due to professional and business services outsourcing – accounts for 36% of the increase in services and 25% of the fall in manufacturing.

What macroeconomic policies for the Eurozone?
Francesco Giavazzi & Guido Tabellini (VoxEU) Sep 25, 2014
In a recent column, the authors suggested coordinating monetary and fiscal expansions in the Eurozone through a money-financed temporary tax cut. The effectiveness of their proposal, however, has been questioned. In this column, the authors address some of the criticisms. They argue that the counter-cyclical fiscal policies adopted by the US and the UK, together with monetary easing, had a stabilising effect on output. Moral hazard due to the more lax monetary and fiscal policies is avoidable, increasing the credibility of the future spending cuts.

Losing the Race Against Ebola
NYT Sep 26, 2014
Two new projections show the urgent need for faster action, to prevent hundreds of thousands or even a million deaths.

Francis Fukuyama’s ‘Political Order and Political Decay’
David Runciman (FT) Sep 26, 2014
The triumph of liberal freedoms looks far from assured in this grand survey of political change since the Industrial Revolution – and the US is no exception.

Europe’s Austerity Zombies
Joseph E. Stiglitz (Project Syndicate) Sep 26, 2014
“If the facts don’t fit the theory, change the theory,” goes the old adage. But too often it is easier to keep the theory and change the facts – or so German Chancellor Angela Merkel and other pro-austerity European leaders appear to believe.

Paying for Productivity
Laura Tyson (Project Syndicate) Sep 26, 2014
One of the US economy's defining – and disheartening – trends over the last 40 years has been real-wage stagnation for most workers. America’s long-run living standards and economic competitiveness depend not just on productivity growth, but also on how that growth is shared.

Europe's Rebalancing Act
Mark Whitehouse (Bloomberg View) Sep 26, 2014
Capital flows suggest Europeans are regaining faith in their common currency.

Levine on Wall Street: Bank Examiners and Argentine Evasions
Matt Levine (Bloomberg View) Sep 26, 2014
You got some regulatory capture, some contempt of court, some empire-building, some regulatory turf battles, and a little bit of regulatory arbitrage, it's all here really

The Misguided Rush to Raise Rates
Mark Gilbert (Bloomberg View) Sep 26, 2014
These are still not normal economic times, and the philosophical temptation to imagine some normal cost-of-money environment that central banks should rushing toward is a falsehood.

Falling Out of Love With Gold
Mohamed A. El-Erian (Bloomberg View) Sep 26, 2014
Gold may be losing favor among investors, but it still has a place in any investment portfolio.

Azerbaijan Doesn't Want To Be Western
Thomas de Waal (FA) Oct 26, 2014
The rhetoric and reality of Baku's grand strategy.

Crash Course: Preventing the Next Financial Crisis
Jonathan Kirshner (Boston Review) Sep 26, 2014
If you only read one book on the 2008 financial crisis, it should be Martin Wolf's.

Tax Carbon Consumption: Europe’s Best Environmental Strategy
Phillippe Legrain (Globalist) Sep 27, 2014
What Europe needs to do on climate change – and how.

The Entrepreneurial State and the Innovation Economy
Avinash D. Persaud (PIIE) Sep 27, 2014
Most technological advances that power entrepreneurial ventures do not bubble up on their own; they are given a helping hand by the state. And the course of innovation and technology is not driven by random discoveries. It is defined by our imagination. The state has a central, visible role to play in that by setting goals. It can use its convening power to help decide on the course society should take and the goals that take us there. It can help lead us there by using independently awarded funding that not only enables this future but actually makes it a reality.

Mismeasuring long-run growth
Leandro Prados de la Escosura (VoxEU) Sep 27, 2014
As demonstrated by the dramatic upward revision of Nigeria’s GDP for 2013, the choice of a benchmark year matters when computing GDP statistics. This column explains how the replacement of benchmark years creates an inconsistency between new and old national accounts series, and how different ways of resolving this inconsistency yield very different estimates of historical GDP levels and growth rates. When used to evaluate the relative historical performance of Spain and France, the interpolation procedure for splicing national accounts produces more plausible results than the conventional ‘retropolation’ approach.

An ASEAN Economic Community by 2015?
Jayant Menon (VoxEU) Sep 27, 2014
The Association of Southeast Asian Nations is the most successful regional grouping in the developing would. Its latest project is to establish an ASEAN Economic Community by 31 December 2015, consisting of economic, political-security, and social cultural components. This column argues that giving commitments more teeth is the key challenge to be overcome in realising the ASEAN Economic Community if it is to be more than a political exercise in solidarity.

Bill Gross missed the big shift
Gillian Tett (FT) Sep 28, 2014
Now it is governments that are intimidating – or at least wrongfooting – the bond gurus.

Germany’s eurosceptics plant turmoil
Wolfgang Münchau (FT) Sep 28, 2014
The AfD only needs to create doubt to upset economic equilibrium.

Mars mission also benefits India’s poor
Gurcharan Das (FT) Sep 28, 2014
Nation-building entails the memory of heroic achievements such as this.

A looser grip for Beijing’s heavy hand
Henny Sender (FT) Sep 28, 2014
In ‘Markets Over Mao’, Nicholas Lardy assesses the rise of private business in China.

Capital Markets Ride to the Third World Rescue
Robert Greifeld (WSJ) Sep 28, 2014
In 2010 Sri Lanka emerged from decades of civil war in bad shape. Two years later, it posted 6.4% growth.

Let’s export oil
Robert J. Samuelson (WP) Sep 28, 2014
There are benefits to letting U.S. producers sell abroad.

The Irrationality of Independence
Angel Ubide (PIIE/El Pais) Sep 28, 2014
We were lucky. In the Scottish independence referendum a few weeks ago, rationality prevailed. The psychology of the process of complex decision making shows that humans are often unable to properly assess the risks they face. When the variables at stake are many and complex, the human brain is not able to convey a clear and concise verdict, and sometimes decisions are guided by intuition and feeling, often in an inefficient and irrational manner, accepting excessive risks.

Ebola Is Going Global. Or Not.
Mark Buchanan (Bloomberg View) Sep 28, 2014
How bad will the Ebola epidemic get? The truth is that nobody knows.

The rise of China and the future of US manufacturing
Daron Acemoglu, David Autor, David Dorn, Gordon H. Hanson and Brendan Price (VoxEU) Sep 28, 2014
Manufacturing in the US has rebounded after the Great Recession, but employment levels have not recovered from their steep decline in the decade before the recession. This column examines to what extent the sector’s fall is a result of the rise of China. The authors estimate direct effects of import competition from China, as well as labour market and buyer-seller indirect effects that operate at the local level. China’s impact has been strong, and employment in US manufacturing is unlikely to recover.

Revisiting the Lehman Brothers Bailout That Never Was
James B. Stewart and Peter Eavis (NYT) Sep 29, 2014
New accounts of events in 2008 as the New York Fed assessed the bank's eligibility for rescue from bankruptcy have cast the firm's collapse in a new light.

Merkel should stop Draghi’s meddling
Hans-Werner Sinn (FT) Sep 29, 2014
The ECB is overstepping its mandate with anti-deflationary measures.

Time to shake up housing finance
Pauline Skypala (FT) Sep 29, 2014
Focus of structural reform should extend beyond banking.

Fees are a scourge on pension funds
Charles Goodhart (FT) Sep 29, 2014
Data show high fees are biggest contributor to poor performance.

The Japanese Deflation Myth and the Yen’s Slump
Brendan Brown (Mises Daily) Sep 29, 2014
The slide of the yen since late summer has brought it to a level some 40 percent lower against the euro and US dollar than just two years go. Yet still Japan’s Prime Minister Shinzo Abe and his central bank chief Haruhiko Kuroda warn that they have not won the battle against deflation. That caution is absurd — all the more so in view of the fact that there was no deflation in the first place.

Draghi Is Forced to Match Words With Action
Mohamed A. El-Erian (Bloomberg View) Sep 29, 2014
Promises alone won't fix Europe's economy.

The Expansion of Chinese Railways in Africa Are Picking Up Steam
Yun Sun (Brookings) Sep 29, 2014
Construction on a $3.8 billion railway will rejuvenate the existing but outdated East Africa railway system.

Golden Rule
Alan Greenspan (FA) Sep 29, 2014
Why Beijing is buying.

A flexible, scaleable approach to the international patent 'name game'
Mark Huberty, Amma Serwaah and Georg Zachmann (Bruegel) Sep 29, 2014
The inventors in PATSTAT are often duplicates: the same person or company may be split into multiple entries in PATSTAT, each associated to different patents. In this paper, we address this problem with an algorithm that efficiently de-duplicates the data. It needs minimal manual input and works well even on consumer-grade computers. Comparisons between entries are not limited to their names, and thus this algorithm is an improvement over earlier ones that required extensive manual work or overly cautious clean-up of the names.

Two Views of Finance
Simon Johnson (Project Syndicate) Sep 29, 2014
The International Monetary Fund’s annual meetings will be held on October 11-12 in Washington DC, and the world’s financial sector is a central item on the agenda. That will make for an interesting meeting, because two diametrically opposed views of the global financial system will face off against each other.

The Rise of the Robots
J. Bradford DeLong (Project Syndicate) Sep 29, 2014
The venture capitalist Peter Thiel recently joined the long-running debate on the economic implications of advanced robotic and computing technologies, asserting that they will save us from a future of high prices and low wages. Does his argument stand up to scrutiny?

Deleveraging, What Deleveraging? The 16th Geneva Report on the World Economy
Luigi Buttiglione, Philip Lane, Lucrezia Reichlin and Vincent Reinhart (VoxEU) Sep 29, 2014
The world has not yet begun to deleverage its crisis-linked borrowing. Global debt-to-GDP is breaking new highs in ways that hinder recovery in mature economies and threaten new crisis in emerging nations – especially China. The latest Geneva Report on the World Economy argues that the policy path to less volatile debt dynamics is a narrow one, and it is already clear that developed economies must expect prolonged low growth or another crisis along the way.

Inequality is such a drag on economies
Martin Wolf (FT) Sep 30, 2014
Big divides in wealth and power have hollowed out republics before and could do so again.

Modi’s legacy should be sewers, not ‘smart’ cities
Chandran Nair (FT) Sep 30, 2014
He should not be distracted from the unglamorous basics.

Europe needs a flexible financial market
Huw van Steenis (FT) Sep 30, 2014
Europe needs to channel non-bank funding to businesses and infrastructure.

Online dialogue of first world problems
Lisa Pollack (FT) Sep 30, 2014
A popular internet meme reminds us of the privileges enjoyed by many in wealthy countries.

Concern over debt of Asean companies
Jeremy Grant (FT) Sep 30, 2014
S&P says 100 groups spent nearly $300bn on deals over a five-year period.

The Time Is Right for an Infrastructure Push
Abdul Abiad, David Furceri, and Petia Topalova (IMF Survey) Sep 30, 2014
In the current global environment of sub-par growth, there is a strong case for increasing public investment in countries where conditions are right.

Global Imbalances: Narrowing Flows, Widening Stocks
Aqib Aslam, Samya Beidas-Strom, Marco Terrones, and Juan Yépez (IMF Survey) Sep 30, 2014
As global current account imbalances wane, net creditor and debtor positions have diverged further.

Solving Europe’s Credibility Problem
Jean Pisani-Ferry (Project Syndicate) Sep 30, 2014
As the eurozone debates how to escape the stagnation trap in which it finds itself, one question has become increasingly important: Can governments credibly commit to trim public spending in the future while avoiding immediate cuts? Fortunately, the answer is yes: Fiscal accommodation now does not rule out consolidation later.

Markets’ Rational Complacency
Nouriel Roubini (Project Syndicate) Sep 30, 2014
A century ago, financial markets priced in a very low probability that a major conflict would occur, blissfully ignoring the risks that led to World War I until late in the summer of 1914. Back then, markets were poor at correctly pricing low-probability, high-impact tail risks; they still are.

The Fed Trap
Stephen S. Roach (Project Syndicate) Sep 30, 2014
The US Federal Reserve is grappling with the disparity between its unconventional policy's success in preventing economic disaster and its failure to foster a robust recovery. Given that this disconnect has fueled financial-market excesses, the exit will be all the more problematic – especially for the market-fixated Fed.

The Third Way's Second Chance
Andrés Velasco (Project Syndicate) Sep 30, 2014
Remember Tony Blair and Bill Clinton’s Third Way? The faces and names have changed, but the idea that governments can – and should – combine social-democratic values and modern liberal economics has returned to center stage.

China’s Internet Revolution
Jiang Qiping and Jonathan Woetzel (Project Syndicate) Sep 30, 2014
As Internet adoption reaches critical mass in China, it will help to unleash the economy’s productivity-growth potential. Indeed, the Internet can help China attain its goal of developing a sustainable economic model that can lift the country to high-income status.

Why the Fed Will Go Faster
Martin Feldstein (Project Syndicate) Sep 30, 2014
The US Federal Reserve has emphasized that its monetary policy will be determined by what economic indicators show. But that means that the Fed is likely to raise the federal funds rate more rapidly and to a higher level than its recent statements imply.

China’s Grudge Match Against Multinationals
John West (Globalist) Sep 30, 2014
What motivates China’s leaders to go up against Western companies?

What Hong Kong Means for the Global Economy
Mohamed A. El-Erian (Bloomberg View) Sep 30, 2014
China's crackdown on protests may also mean a slowdown in its economic reforms -- a setback for the rest of the world, too.

No, Shanghai Can't Replace Hong Kong
William Pesek (Bloomberg View) Sep 30, 2014
Some in China seem to think that businesses fleeing Hong Kong will just move to Shanghai, which the regime is trying to build up as a financial hub. In fact, they're likely to flee to Singapore.

Germany Fights on Two Fronts to Preserve the Eurozone
Adriano Bosoni and Mark Fleming-Williams (Stratfor) Sep 30, 2014
The European Court of Justice announced Sept. 22 that hearings in the case against the European Central Bank's (ECB) bond-buying scheme known as Outright Monetary Transactions (OMT) will begin Oct. 14

Offshoring and skill-biased technical change
Daron Acemoglu, Gino Gancia and Fabrizio Zilibotti (VoxEU) Sep 30, 2014
Offshoring of production can have a deep impact on the wages and welfare of workers with different abilities through its effect on technological progress. This column argues that, when labour is sufficiently cheap abroad, firms have incentives to offshore low-skill tasks and invest in skill-biased technologies at home. Over time, however, offshoring raises foreign wages. This increases demand for all firms and makes innovations complementing low-skill workers more profitable. As a result, offshoring can eventually lead to higher wages for everybody and less inequality.